In 1977, 5-year-old Pete Healy is on a road trip with his parents when their car flips off the

road
after nearly colliding with a deer. Pete's parents are killed but he survives and is chased into the
forest by a wolf pack, then rescued by a large dragon with wings, green fur, and yellow eyes.
Pete and the dragon quickly bond; Pete names the dragon Elliot after the lost-puppy character in
his favorite book, and Elliot becomes protective of Pete.
Six years later in 1983, 11-year-old Pete spots a lumberjack crew chopping down trees near his
home. Natalie, the daughter of ethical site foreman Jack, spots and chases him. When she
accidentally falls from a tree, her screams attract Jack and his girlfriend, park ranger Grace
Meacham. Pete tries to run away, but Gavin, Jack's ruthless brother, accidentally knocks him
unconscious. After realizing that Pete has vanished, Elliot stumbles around looking for him and
ends up knocking over a tree near the lumber camp, leading Gavin to organize a hunting party to
find him. Meanwhile, Pete awakens in a local hospital; he escapes and tries to return to the
forest.
Gavin and his men locate Pete and Elliot's treehouse, but when they try to search it, Elliot
reveals himself and scares them away. He follows them to town trying to find Pete. When he
sees Pete settling in with Grace's family, he leaves. Pete gives Grace a drawing of Elliot and she
shows her father, Conrad, who says he discovered the same dragon as a young man. He
advises her to trust Pete and find Elliot.
The next day, Pete, Grace, Natalie, and Conrad travel to the forest to meet Elliot. A group of
hunters led by Gavin surprises Elliot and shoots him with tranquilizer darts, then lock him up in
Jack's warehouse. Before the authorities can inspect the dragon, Pete and Natalie free him from
his chains and escape on a lumber truck with Conrad.
Angered, Gavin sets up a roadblock at the bridge to stop them. When Elliot tries to fly, he
crashes into the truck, damaging its brakes and it goes through the barricade. Confused and
frightened, Elliot perches on top of the bridge and starts breathing fire at the police. The bridge
begins to collapse under the intense heat, causing Grace and Jack's truck to fall through, Gavin
then abandons his attack and tries to save them from death. Elliot emerges from the ravine with
Grace and Jack riding safely on his back. With a firefighting helicopter approaching, Pete flees
with Elliot back to the woods.
Pete pleads with Elliot to let him stay so he can protect him from his attackers, just as Elliot
protected him. However, Elliot concludes that as long as they stay close together, Pete will
always be in danger. He points out Pete's book to encourage him to return to stay with Grace
and Jack. Pete is reluctant, and worried for Elliot's safety, but ultimately trusts the dragon's
judgment. After a very tearful hug, Elliot returns to the mountains and Pete returns to live with
Grace and Jack as his new family.
In the years that follow, Grace and Jack marry and adopt Pete as their son. Not only has Elliot
slowly faded from the town's memory, but Gavin has learned to be more scrupulous and has
moved on from the experience. Pete and his family eventually go on vacation and see that Elliot
is finally reunited with his fellow dragons.